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1 How does product disparagement differ from defamation of a
nonpublic
figure?
Malicious intent is required for the defamation case, but not in
the disparagement case
Publication to a third party is required in the defamation case,
but not in the disparagement case
Publication to a third party is required in the disparagement
case, but not in the defamation case
Malicious intent is required for a disparagement case, but is
not required in the defamation case
2 Which of the following is a key element of successful
Enterprise Risk Management?
Nondisclosure agreements
Strong investment strategies
Legal counsel
Management commitment
3 Diane bought an action figure for her son David from
Terrence’s Toy Shop. The packaging did not mention that the toy contained small
detachable parts. David accidentally swallowed and choked on one of the
detachable parts and had to be taken to the hospital. On which of the following
product liability charges can Diane sue Terrence’s Toy Shop for damages?
Fraud
Negligence
Nuisance
Misrepresentation
4 Mary was getting a ride home in John’s new car. On the
way, a malfunctioning brake caused an accident and both Mary and John were
injured. Which of the following statements is true of this situation?
Mary can file a negligence lawsuit against the dealership that
sold John his car.
Mary can recover damages for her injury under a theory of strict
liability against the manufacturer of John’s car.
John can file a negligence lawsuit against the dealership from
which he bought the car.
Mary can file a strict liability lawsuit against John.
5 Assuming that statutory requirements have been met,
what is protected under merchant protection statutes?
Merchants are protected from product disparagement claims of
their competitors.
Merchants are protected from false imprisonment claims of
persons detained on suspicion of shoplifting.
Merchants are protected from the intentional torts of their
customers.
Merchants are protected from negligence claims on their business
premises.
6 Which best describes assumption of the risk in a
negligence case?
The defendant gave advance warning to the plaintiff that an
injury would occur.
The plaintiff was involved in an abnormally dangerous activity.
The plaintiff knowingly and willingly subjected herself to a
risky activity.
The plaintiff is more at fault than the defendant in causing the
accident.
7 Making false statements about a competitor’s products,
services, property, or business reputation could make a company liable for
tort of appropriation
misappropriation of the right to publicity
disparagement
intentional misrepresentation
8 Which of the following is the best statement of the
test applied in determining if a defendant’s actions were the proximate cause
of the plaintiff’s injuries?
Was it foreseeable that the defendant’s conduct would lead to
the kind of injury that the plaintiff suffered?
Was it foreseeable that the defendant was the cause of the
plaintiff’s injuries given the nature of those injuries?
Was the injury foreseeable to the plaintiff prior to the
injury’s occurrence?
Was it foreseeable to the plaintiff that the defendant would
engage in this conduct?
9 Which of the following is a defect in manufacture?
Failure to properly design the product
Failure to include adequate instructions for the product
Failure to properly package the product
Failure to properly test the product
10 John Harley was on his way home when an assailant
stopped his car and threatened to physically harm him for driving on that
street. John can sue the assailant to recover damages for
disparagement
battery
assault
libel
11 In order to recover in a products liability case based
on strict liability, the plaintiff must prove that the product had a defect
that
affected the value of the product
made the product unreasonably dangerous
was caused by the defendant
the defendant was aware of
12 Select the option which best completes this statement:
Enterprise Risk Management is most effective when it is a(n) _________ process.
ongoing
informal
static
one-time
13 Dorothy purchases a chair that was made by Woode
Designs, Inc. While making the chair, the legs were not fixed properly to the
base. When Dorothy sits on the chair, it breaks and she is injured. In a strict
liability lawsuit, which of the following can Dorothy cite as a defect in the
chair?
Defect in manufacture
Failure to provide adequate instructions
Failure to warn
Defect in design
14 The failure to design an automobile that will properly
protect the occupants from a person’s body striking something inside their
automobile is known as the
failure to design doctrine
crashworthiness doctrine
defective design doctrine
quality control doctrine
15 According to the doctrine of ________, the plaintiff
is not required to prove that the defendant breached a duty of care.
assumption of risk
contributive negligence
comparative negligence
strict liability
16 Which of the statements below best describes the
concept of Enterprise Risk Management?
Management of a single function of an organization that, upon
implementation and testing, is then processed entity wide
An approach that capitalizes on human intervention as processed
through real change leaders
People, systems, and processes working together across the
organizations to systematically thin about and manage a wide range of risks
that could impede achieving organizational objectives/opportunity
A process affected by an entity’s leaders, management, and other
personnel that is designed to identify potential events that may affect the
entity, and to manage risk
17 A plaintiff wants to sue a defendant under the tort theory
of negligence for his injuries, but the plaintiff knows he was partially at
fault for his own injuries. Which of the following is true?
If the plaintiff's fault is only 5 percent, his recovery will be
the same under either pure or partial comparative negligence.
Because the plaintiff is partly at fault, he will not be able to
recover under either comparative or contributory negligence.
The plaintiff will have to elect whether to sue under
comparative or contributory negligence.
A state whose law applies contributory negligence will not allow
the plaintiff to recover if the plaintiff has any fault for his injuries
18 Gary Govetty is a famous movie star. A tabloid
published an interview with his ex-girlfriend in which she falsely claimed that
Gary was completely bald and had been wearing a wig for several years. Gary can
sue his ex-girlfriend for
invasion of privacy
libel
disparagement
slander
19 Bartie’s, Inc. sells watercolors and pastels that are
marketed as safe for use by children. However, several accounts of lead
poisoning were reported in children who used the products. An investigation
revealed that the company was knowingly manufacturing colors that contained
toxic amounts of the heavy metal. Which of the following torts has Bartie’s, Inc.
committed?
Disparagement
Intentional misrepresentation
Assault
Professional malpractice
20 George, Jerry, and Harry are passengers on a flight
from Chicago to New York. They injure their legs when their seatbelts do not
fasten during takeoff. The airline is sued by all three together for injuries
caused and the airline is found to be negligent and is directed by the court to
pay damages to the injured parties. Which of the following parties is entitled
to recover maximum damages?
All the men recover the same amount of damages, irrespective of
their income or
profession
Harry, a chartered accountant who earns $200,000 a
year
Jerry, a professional football player who earns $2 million a
year
George, a retired professor who gets a pension of $50,000 a year
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